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Unformatted text preview: Case 39: Dead Peasant Life Insurance 1. What are the major ethical issues involved in this case? Is it ethical for an employer to benefit from the death of an employee if they took out and paid for the policy? It seems that the primary ethical issue relates to the law that was relaxed in the 1980s the requirement for an insurable interest in the life of the insured. How many of us would feel justified in taking out a policy on someone in another state whom we had never even met or had any dealings with? Although dead peasant policies do not go to this extreme (there is an employment relationship), it does appear that many of the policies are taken out on people who do not provide irreplaceable skills to the firm. Life insurance is meant to replace a portion of the economic benefit provided by the deceased to those who received or had an interest in those benefits. If a company can easily replace a deceased worker with little or no loss in productivity or profits, the firm would...
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- Spring '07